As leaders of the G-20 countries grapple with the immediate euro crisis, we must look beyond to a more fundamental problem facing the world – rising inequality, joblessness and ultimately a lack of demand, causing deep recession. This is not a cyclical problem that will be addressed by stimulus packages but a more structural problem, inherent in the current growth process.

Addressing inequality is crucial in responding to the current economic, food and climate change crises across the globe. As the spreading Wall Street protests indicate, inequality and a sense that the system only works for the top one percent is under attack across the world. Rising inequality and unemployment is also cited as a major factor in the Arab uprisings which are still playing out. And rising food and fuel prices are again ringing alarm bells.

Even in Asia where there has been a sharp acceleration in economic growth in many developing countries, rapidly rising inequality is causing concern, and the poor continue to suffer disproportionately from high food and fuel prices—in addition to being the hardest hit by an increasing wave natural disasters and rising sea levels.

Rather than trying to compensate those left out of the growth process, inclusive growth is about social and economic policies that focus on ensuring that citizens are included—as workers, entrepreneurs and consumers of public and private goods. In addition, growth will not be inclusive if some groups are discriminated against, overtly or covertly.

To complement national policies that include the poorest citizens there is also the need to ensure that they are able to tide over difficult periods. Within the inclusive growth approach countries have successfully used instruments like conditional and unconditional cash transfers to make basic goods and services more affordable for the poor instead of using subsidies and tax concessions.

Inclusive growth requires a pattern that creates employment—and the agriculture sector, using the rural poor’s unskilled labour is clearly a priority. Given that the centre of economic gravity is moving towards non-farm sectors and urban areas, providing decent employment opportunities to all, particularly enhancing women’s equality and empowerment would boost progress.

Inclusiveness and sustainability are interconnected. The Rio plus 20 summit in 2012 will be an opportunity to address these issues systematically globally.

As Mahatma Gandhi said it so appropriately 70 years ago: “The world has enough to meet everyone’s need but not everyone’s greed“.

Talk to us: How can we ensure that growth is more inclusive and sustainable?

About the Author

Ajay Chhibber of India is Assistant Secretary-General, Assistant Administrator of the United Nations Development Programme and Director of UNDP's Regional Bureau for Asia and the Pacific.